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UK offshore wind to meet 10% of national electricity demand by 2020, says new report

Out-Law News | 13 Jun 2014 | 4:14 pm | 1 min. read

The UK is "on course" to double its offshore wind energy generation capacity to 10GW or more by 2020, meaning that the "maturing" technology would be able to supply around 10% of the country's electricity demand, according to the body responsible for managing the seabed.

The figures emerge from two reports published by the Crown Estate on the growth of offshore wind and potential cost reduction measures which would help the sector to develop. It comes at the end of a record-breaking 2013 during which generation from offshore wind reached 11.5 terrawatt hours (TWh), or enough to power 2.7 million homes, according to the figures.

"There have been a number of significant milestones in 2014 for offshore wind including a total of £750m industry investment announced," said Huub den Rooijen, the Crown Estate's head of offshore wind.

"With around 1,465 wind turbines in operation or under construction and nearly 4GW in operation it is fair to say the industry is coming of age. The certainty affording by the conclusion of Electricity Market Reform (EMR) and continued cost reduction and investment means that offshore wind is on course to provide around 10% of the UK's electricity demand by 2020," he said.

According to the Crown Estate's 2014 operational report (22-page / 2.5MB PDF), generation from offshore wind accounted for 3.3% of UK electricity demand last year with four wind farms accounting for half of the production: London Array, Greater Gabbard, Sheringham Shoal and Thanet. Of these, London Array became the first offshore wind farm in the world to generate more than 2TWh in a single year, accounting for around 17% of UK offshore wind generation in 2013 despite not being fully commissioned until April.

Over the review year, fully operational UK wind farms achieved a 'capacity factor' of 37.7%, which the report said was the highest portfolio average ever achieved. Offshore wind generation employer more than 6,800 people in 2013, more than double than the number employed in 2010, it said.

The government intends to include offshore wind projects within its 'less established' group of technologies for the purposes of access to contracts for difference (CfDs) under its EMR programme. This would mean that these projects would not have to compete with more established technologies such as solar and onshore wind for a share of government subsidy. CfDs are due to replace existing incentives such as the Renewables Obligation from this year, and will provide guaranteed payments to operators of approved renewable generation technology while enabling the system operator to 'claw back' money when market prices are high.

Alongside its operational report, the Crown Estate produced a report on ways in which firms operating in offshore wind could better share knowledge and good practice (18-page / 1MB PDF) in order to reduce the costs and risks of development. Amongst its recommendations, it has proposed the creation of a 'knowledge hub' for sector-specific information sharing.